BETUNIA, West Bank - Israel freed 400 Palestinian prisoners on Thursday in a long-delayed gesture it said was meant to bolster moderate President Mahmoud Abbas but which Palestinians said was not enough to advance peacemaking.

Israeli Prime Minister Ariel Sharon acted under U.S. pressure to help strengthen Abbas, who faces a Hamas challenge that could undermine Israel's plans for evacuating Jewish settlements in the Gaza Strip starting in August.

Smiling ex-prisoners flashed V-for-victory signs to cheering relatives as they stepped down from buses that carried them from Israeli jails to West Bank crossing points. Some knelt in prayer. Others kissed the ground. A few waved Palestinian flags.

In the Gaza Strip, chanting crowds pushed past a Palestinian police cordon to hoist freed militants onto their shoulders. Mothers wept as they embraced sons, and gunmen fired in the air.

But jubilant homecomings were tempered by Palestinian complaints that the mass release did not go far enough because it excluded longer-serving inmates. Palestinians demand amnesty for all 8,000 Palestinian prisoners held by Israel.

"I am happy to be free but thousands of others are still behind bars," Yousef Habas, 31, a militant who spent six months in jail, said as at Betunia checkpoint, near Ramallah, where families danced and sang in celebration.

The release, first pledged by Israel when Sharon and Abbas declared a truce in February 8 talks in Egypt, followed the announcement on Wednesday of a second summit planned for June 21 in an attempt to revitalise deadlocked peace moves.

A first batch of 500 prisoners went free on Feb. 21. But the promised release of 400 more was suspended after a Palestinian suicide bomber killed five Israelis in Tel Aviv on Feb. 25.

Sharon has said Thursday's release was to boost Palestinian public backing for Abbas, who was elected in January to succeed Yasser Arafat and has coaxed militants into a shaky truce that has sharply reduced violence.

Israel wants Abbas to keep armed factions reined in for the Gaza pullout, which international mediators hope will serve as a springboard for new peace talks under a U.S.-backed "roadmap."

The freeing of the prisoners also comes before Palestinian parliamentary elections tentatively set for July in which Abbas's ruling Fatah party will face tough competition from Hamas, an Islamic militant group sworn to Israel's destruction.

Green light from Israeli cabinet

Israel's cabinet gave the green light for Thursday's release under prodding from the United States. President Bush gave Abbas strong support in Washington last week despite Israel's demands that he do more to disarm militants.

Israel says none of the freed men were convicted of killing or hurting Israelis. Some faced charges of belonging to militant groups, possessing weapons or plotting attacks, but others were accused of lesser offences.

As the prisoners headed toward the West Bank and Gaza, Israeli security forces announced the arrest of five Islamic Jihad militants who they said were planning to carry out a double suicide bombing in Jerusalem on Thursday. Israeli media said two of the five were recently released from prison.

Palestinian officials dismissed Thursday's release as a public relations stunt and said Abbas needs more prisoners freed to preserve the nearly four-month-old ceasefire.

Prisoners are an emotive issue for many Palestinians, who see their brethren held in Israeli jails as heroes fighting occupation in the West Bank and Gaza, lands that Israel captured in the 1967 Middle East War.

Israelis hurt by militants or related to people killed in attacks failed in a last-minute legal challenge to the release.

Palestinian and Israeli officials said Jerusalem could be the site of Sharon and Abbas's second summit. Coordination of Israel's withdrawal from 21 Gaza settlements and four of 120 enclaves in the West Bank is expected to top the agenda.

Abbas, 70, was hospitalised in Jordan on Wednesday with chest pains and had an operation to open a constricted blood vessel. He was discharged and was expected to return to the West Bank on Friday, Palestinian officials said. "I am in good health," he told reporters in Amman.

- additional reporting by Nidal al-Mughrabi in Gaza and Haitham Tamimi in Tarkumiya